With contractors, material suppliers, and construction-related clients owed nearly a combined $1 million in unsecured claims, Virginia general contractor VP Construction filed for Chapter 11 bankruptcy on December 17, 2020, according to the US Bankruptcy Court for the Eastern District of Virginia.
Additionally, the GC is facing two upcoming lawsuit hearings regarding “warrant in debt” cases in Arlington General District Court, currently set for early 2021.
VP Construction, which is headquartered in Arlington, Virginia (while also serving parts of Maryland), lists zero secured claims and only the 20 largest unsecured claims in their bankruptcy filing, which total a combined $1,938,821.46 owed to a variety of creditors.
At the time of their bankruptcy filing in December of 2020, VP Construction reported the following estimates:
- $1,000,001 – $10 million in liabilities
- $0 – $50,000 in assets
- 50 – 99 creditors
A company spokesperson from VP Construction could not be reached for comment.
What is Chapter 11 bankruptcy?
Under Chapter 11 of the US Bankruptcy Code, debtors may seek to reorganize their business financials in order to pay back creditors and to keep their business alive.
Upon filing for Chapter 11 relief, a debtor must present a debt repayment plan to the overseeing bankruptcy court and creditors. Between the debtor’s bankruptcy filing date and the confirmation of the debt repayment plan, the debtor must reorganize their finances.
If they cannot successfully reorganize or get a debt repayment plan approved, a debtor’s Chapter 11 case could be reverted to a liquidating Chapter 7.
VP Construction bankruptcy filing lists 20 largest unsecured claims, no secured claims
According to the bankruptcy filing, VP Construction owes a combined $975,751.46 to seven contractors and suppliers and five construction clients. Each creditor holds an unsecured claim. VP Construction’s Chapter 11 bankruptcy does not list any creditors with secured claims.
The seven contractors and suppliers listed as creditors are owed a combined $482,851.46:
- Builder Services Group, Inc. d/b/a Davenport Insulation – $24,781.86
- Builders Insulation CWI Holdings – $39,000
- Carter Lumber – $257,000
- HDS Drywall Service, Inc. – $31,000
- Paintworx – $80,000
- Nissan Motor – $39,638.73
- Waypoint Cabinets/American – $11,430.87
Five of VP Construction’s 20 largest reported unsecured claims involve construction contract disputes with Arlington-based clients, totaling $492,900.
The largest of the five construction contract claims is worth $300,000, which is unliquidated and disputed, according to the bankruptcy filing.
VP Construction involved in several lawsuit hearings set for 2021
According to Virginia court records, VP Construction is set to face two plaintiff subcontractors for “warrant in debt” cases in Arlington General District Court upon the start of 2021.
Subcontractor K&K Electric & Construction is set to have their case heard on January 5, 2021 after originally filing the case on November 30, 2020.
On November 9, 2020, subcontractor Gabriel Construction filed their lawsuit against VP Construction specifically concerning contract debt. The subcontractor’s case was first heard on December 7, 2020, and Virginia court records state the case will continue on February 11, 2021.